MND Cancels Rectification Order Issued To Aljunied-Hougang Town Council And Seeks Clarification Following Court Of Appeal’s Judgments

MND Cancels Rectification Order Issued To Aljunied-Hougang Town Council And Seeks Clarification Following Court Of Appeal's Judgments

Aug 22, 2023

MEDIA STATEMENT

MND CANCELS RECTIFICATION ORDER ISSUED TO ALJUNIED-HOUGANG TOWN COUNCIL AND SEEKS CLARIFICATION FOLLOWING COURT OF APPEAL'S JUDGMENTS

The Minister for National Development has cancelled the Rectification Order ("Order") issued to Aljunied-Hougang Town Council ("AHTC") in January 2020. Details of the Order are in the Annex to this Statement.

2. The Minister notes that the Court of Appeal ("CA") has found that Ms Sylvia Lim ("Ms Lim"), Mr Low Thia Khiang ("Mr Low"), Mr Pritam Singh ("Mr Singh"), Mr Chua Zhi Hon ("Mr Chua"), Mr Kenneth Foo ("Mr Foo"), Ms How Weng Fan ("Ms How") and Mr Danny Loh ("Mr Loh") did not act in good faith in the discharge of their duties. This is a serious finding. They did not act in good faith in the payment processes of AHTC. The CA also found them to be grossly negligent. They allowed the Managing Agent, FM Solutions & Services Pte Ltd ("FMSS"), to pay monies to itself, and others, without proper controls. Monies could be paid, even if work was not done, or not properly done.

3. Further, the CA also found that Ms Lim was responsible, for a contract to Red-Power Electrical Engineering Pte Ltd at rates that were four to seven times higher than those offered by the then existing vendor, Digo Corporation Pte Ltd and Terminal 9 Pte Ltd.

4. Ms Lim and Mr Singh remain as AHTC's town councillors today. In addition, Ms Lim is a member of the Audit Committee and a member of the Estate & Community Liaison Committee; and Mr Singh chairs the Public Relations Committee and is also a member of the Tenders and Contracts Committee and the Estate & Community Liaison Committee. As such, they may continue to be involved in implementing and/or monitoring AHTC's payment process, as well as make procurement decisions.

5. Given the CA's findings of Ms Lim and Mr Singh acting without good faith, and in gross negligence, MND has written to AHTC seeking information on: (i) Ms Lim's and Mr Singh's specific powers and duties in relation to their involvement in AHTC's payment and procurement processes, (ii) actions that AHTC intends to take, if any, in relation to Ms Lim and Mr Singh, given the CA's findings that they acted without good faith, and in gross negligence and (iii) such other actions AHTC intends to take. Upon receiving AHTC's response, the Minister will consider whether further regulatory action under the Town Councils Act is required to safeguard public monies entrusted to the Town Council.

Issued by: Ministry of National Development

Date: 22 August 2023

Annex:

· The Order had required AHTC to take action to guard against a recurrence of irregularities in AHTC's financial affairs, specifically by restricting the powers of two of their town councillors, Ms Lim and Mr Low, with respect to certain financial decisions.

· The Minister had issued the Order under the Town Councils Act as AHTC did not require Ms Lim's and Mr Low's recusal from financial matters despite the High Court having found both of them to have breached their fiduciary duties to AHTC. The Order noted that Ms Lim and Mr Low had filed an appeal against the judgment and indicated that the Minister would review the Order after the appeal had been heard and disposed of.

· The CA's judgments have been released in November 2022 and July 2023. The Minister has considered the CA's findings that Ms Lim and Mr Low do not owe fiduciary duties to AHTC, and upon review, decided to cancel the Order.

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